By Edward Chisanga
Economically, Zambia is at crossroads. On the one hand, there’s growing poverty and inequalities which is fanning anger, political and social flames. On the other, there’s growing finger-pointing. PF, its supporters, and sympathizers are basically inflaming the public that prices of essential commodities like fuel and food have risen from their point when PF leadership left office. Of course, prices have risen, in many instances beyond affordability of a common man and woman who don’t have as much purchasing power as the elite and those who simply stole.
But, what no one, even the ruling government is not vigorously explaining is the cause. I’m not an Economist by academic fittings. But, I understand economics and statistics enough to know who caused the current economic meltdown in our country. And, if I were of HH camp, it’s here I would vigorously and repeatedly make my point. Much as we must vigorously hold our elected officials including the President accountable as they run our economy, it must be based on responsibility. We must distinguish between symptom and cause. It’s unfair to entirely place accountability on symptoms and particularly those trying to correct them.
Every symptom traces a cause. In the last ten years, long before HH government arrived, the Zambian economy has been witnessing one of the most dramatic downturns, such that putting the entire blame on Covid19 is to be irresponsible. If we separate cause from symptom, we will see that in the last ten years, Zambia’s economic turmoil can easily be traced back to PF rule. President Hichilema, the person who is being blamed for these symptoms is a wrong one. Blame the right person.
What the HH government did not do but which was done by President Lungu
Using statistics, HH and his team must vigorously and repeatedly explain to the Zambian people the part that they did not do, or the cause of the problem in parallel with the problems they’re responsible for. The economic problem caused by President Lungu and his team which is now translating into economic hardships in households must be explained to the public. President HH and his government did not cause this. They inherited it. What Zambians forgot to see was that while they and the PF President were dancing Dununa reverse, Dununa Reverse was in fact reversing the Zambian Economy into pauperism experienced today, from what the Mwanawasa and Banda Presidency left.
Statistics show that this downturn of the economy was caused not by HH.
Figure 1 below shows annual average growth rate per GDP capita over the last ten years. It clearly shows that HH leadership is not responsible for causing Zambia’s economic troubles. I use the economic indicator of gross domestic product (GDP) per capita to explain the foregoing story due to its direct impact on the purchasing power of individual households. Economic experts tell us that when GDP per capita is rising, it denotes good purchasing power and living standards while the fall points to deteriorating purchasing power and living standards. This statistic you see below shows the trend in deteriorating living standards of Zambians. The Real GDP growth follows similar deteriorating pattern.
According to global economic governance, it’s the government that caused the problem that must be held accountable. We must begin by bringing to the Independence Stadium, the President that caused the economic mortification so he could explain to the Zambian people. We must ask him to explain if we celebrated political independence under his rule only to become poorer after ten years. It’s he and his team that are responsible for these economic hardships we see today.
Leadership accountability must begin with the cause of the problem, not the one trying to fix it. Accountability to the one trying to fix it should be based on the economic hiccups caused by him. That’s what we should always do as responsible citizens. It’s wrong for us to focus on blaming the innocent while ignoring the culprit. That’s where we always go wrong. Someone creates a national problem like hunger due to mismanagement of the economy. We ignore and point a finger at the new leader trying to correct things. That’s wrong.
Now, let us see what statistics tell us. Figure 1 below shows that Zambia’s GDP per capita has been shrinking in the last ten years, down from about 6% in 2010 to minus 6% in 2020 during the PF rule. This is a scandal, in particular by a government that thrived on public impression that the economy was doing well, Look at infrastructure, manifested in roads, clinics, football stadiums, public offices and other physical buildings erected by President Lungu, they used to brag about.
But expenditure on roads and other unproductive structures were at the expense of the economy. These so-called nice roads are not even used by the common man or woman but the elite that often show no respect for poor pedestrians. The roads have become so dangerous to common people that they even prefer potholed roads. Roads with potholes at least restrain reckless drivers from over speeding, thereby save lives.
Can critics explain how an economy not growing for ten years can feed its people today?
If the Zambian economy, measured by GDP per capita growth was declining in the last ten years, juxtaposed by growing debt, how is it possible for it to hold Zambians on its shoulders? How is it possible for it to feed its people? How can we responsibly expect a new government of one year to remove poverty created over the last ten years?
The poverty of today is something inherited by the new government from economic mismanagement of previous leadership. You economists know too well that a degenerating economy of the PF magnitude is not a strong foundation to generate jobs, provide affordable food and fuel prices. Jobs, affordable food and fuel prices are an outcome of a growing economy. But ours is not growing. It is declining.
Most Zambian consumers are not spending as much as they can because they cannot afford when the GDP per capita is falling. GDP per capita stimulates spending when it is growing. The living standards of Zambians will only improve if they continue to buy. This economy is not growing. In fact, it has been declining. Drivers of an improved standard of living include exporting more dynamic products, not simply raw copper.
Productivity and exports of dynamic products key
We will not get anywhere if we continue to rely on exports of raw copper. A nation cannot plan based on copper exports alone. How can we simply wait for the world prices of copper to rise in order for us to plan our economic future? When we won political independence in 1964, we promised citizens that we will diversify and add value to the country’s exports. Sixty years have passed, and our total exports are represented by almost 90% of primary commodities shown in Figure 2 below at the expense of manufactured goods. We have a private sector that speaks more than it works. In its current form, I don’t see how it can compete globally and even regionally.
Go to South Africa and visit their shopping malls and come back to Zambia and tell us if you found any Zambian export product sitting on their shelves. Yes, you have the so-called Trade King in Zambia. But the kingdom is not seen in South Africa because of shallow products.
Today, we are swamped by slogans of value addition and that’s important. But one hopes that this time around, implementation will take place. It better be because, according to a statement I read in the Lusaka Times, “Ministry of Labour and Social Security Acting Permanent Secretary, Zechariah Luhanga, said labour productivity in Zambia contracted by 21 per cent between 2019 and 2020.” International Labour Organization tells us, “Labor productivity is an important economic indicator that is closely linked to economic growth, competitiveness, and living standards within an economy.”
I want to know. When the Zambian economy, purchasing power and productivity are ceasing to develop, when they are declining, as is the situation today, can we expect the country to feed us three meals a day? Must prices of fuel, mealie-meal and other essential commodities continue to be at the same level as they were during the PF rule of no economics? PF leaders continue to boast that its economics served interests of Zambians when in fact this was based on subsidization. They contend that UPND is making lives of Zambians miserable. That’s not true. PF created all this messy we are in.
I have said it before, but no one listens. We are going everywhere. We are rubbing shoulders with everyone. But, we have not yet done so with countries where value addition is taking place in Africa and in Asia. Value addition is taking place in Morocco, Mauritius and Viet Nam. Yet, Zambia has no robust partnership with them.
Finally, can those who are fantasizing coming back to power explain to Zambians, how, after destroying the economy, they plan not to hurt it more. Is there moral justification that leaders who destroy the economy and bring economic misery to their people should be rewarded by bringing them back to rule us again?